Low supply and high demand are primary factors in the price of any product, and that's certainly a big reason why Tri-Cities home prices have been rising and hitting record highs in recent months.
But it's not the only reason.
Rising lumber prices are also a big factor. When it costs local builders more to source lumber and other materials needed to build a house, those higher costs trickle down to buyers in the form of higher home prices.
According to the National Association of Home Builders, lumber prices have tripled over the past year across the country causing the price of an average single-family home to rise by $35,872. And it's not just lumber ... other building materials used in construction are 9.8% more expensive today than a year ago.
Where lumber is concerned, the NAHB says these are the driving forces behind today's higher prices:
- Many lumber mills lowered production last spring due to stay-at-home and similar orders when the pandemic hit, but didn't ramp up production in the following months as demand remained high.
- A "massive" increase in demand for lumber from DIY remodelers and big-box retailers.
- Tariffs on Canadian lumber imports into the U.S.
The NAHB says that this increase of almost $36K has priced about 5.5 million US households out of the real estate market.
-Cari
